Strategic Human Resource Planning - Essay Example

? Strategic HR Planning Introduction The organisations in today’s competitive era have realized the importance of human and capital management because both are considered critical for the achievement of long term and short term goals. The HR managers are now focusing on employing right people, at the right position and at the right time with the right set of skills, knowledge and abilities. Shift from personnel management to human resource has called for innovation and change and thus, keeping this in view, organisations are inclined towards strategic human resource planning as the ultimate solution of the challenges being faced by them in this competitive era. Strategic Human Resource Planning Strategic human resource planning is a process in which organisations ensure that the right people are employed with the right skill set. It is ensured that the desired set of behaviour have been developed in them through employee training or development. Organisations probe into these factors to get to know whether their employee developmental programs are such that can easily lead to the achievement of organisational goals and objectives or they need to employ such people that can lead to successful completion of tasks. According to (Carroll, 12) human resource planning refers to identifying and analysing the availability of human resources for the purpose of ensuring whether an organisation can achieve its intended goals and objectives. It is a complex process and requires specialized skills in the field of planning because it relies heavily on identifying the right set of people with the right skill set. Purpose of Human Resource Planning Today the successful organisations are heavily involved in planning their human resource requirements. Companies carry out strategic human resource planning for the following purposes. It is usually done to evaluate the future manpower requirements. To enable business to face the challenges posed by continually changing environment. To prepare organisation and its employees for any technological changes that arises in industry and lastly to prepare employees to adapt to the changing environment (Carroll, 12). Human resource planning is linked with strategic planning in a way that it provides input for strategy formulation and implementation process. It allows managers to evaluate whether they have the right set of people with the right skill set to pursue their organisational strategy. Secondly, it envisioned managers regarding firms’ resources both financial and human capital because these are two of the most important resources that help in the execution of the strategies once they have been devised by the concerned executives. Strategic Human Resource Plan Managers at Jim Cleaning aim at linking their strategic planning process with human resource planning because they are aware of the fact that employees are valuable assets of any organisation and thus, it is required that there should be a proper strategic HR plan devised that depicts a guideline for the employees as to how to move towards achieving their organisational goals and objectives. According to (Snell &Bohlander, 48), following are the steps involved in developing a Strategic HR plan and keeping in view steps the managers at Jim Cleaning proposed for the HR strategic plan. Step 1: Analysing mission, vision and core values The first step involved in developing strategic HR plan is to develop mission and vision statement. Mission statement shows the purpose of existence of the organisation whereas the vision statement shows that what an organisation aspires to become in near future. These statements help organisations to develop their strategic goals and objectives whereas the core values of an organisation provide managers with principles and beliefs that aid them in decision making process. Step 2: Environmental Scanning The second step involved in developing strategic HR plan is environmental screening. Managers at Jim Cleaning are very much concerned regarding the impact of external environmental forces over business operations. Managers prefer to carry out careful screening of external opportunities and threats and figure out their direct and indirect impact on company’s operations. The environmental screening basically requires the systematic monitoring of all types of threats and opportunities prevailing in external environment. Screening process, enable managers to avail all the opportunities prevailing in the external environment and to devise policies that prevent an organisation from the impact of external threats. While doing environmental screening managers are concerned with economic, political, demographic, technological and industrial changes because these factors one or the other way affects organisations’ ability to achieve their intended goals and objectives. Step 3: Internal factor analysis Managers while doing strategic planning carry out careful analysis of internal strength and weaknesses to analyse about the factors that need to be capitalized and what are the issues that need to be resolved in detail. The internal analysis mostly depends on three important factors such as capability, composition and culture (3Cs) (Snell &Bohlander, 53). The details of these internal factors that need to be considered are as follows: Capabilities: human capital as a strategic resource Most of the managers in today’s competitive era believe in developing set of core capabilities that not only distinguishes it from its competitors but also allow them to deliver superior customer value. Most of the firms’ requirements for core capabilities are embodied in people and such companies consider people as a strategic resource. It is because of the fact that when organisations develop their strategic goals and objectives they prefer to integrate such knowledge sets that allow them to achieve competitive edge. Composition: Building Human Architecture Managers at Jim Cleaning are very much concerned regarding the type of people and the type of skill set needed for achieving organisational goals and objectives. Keeping this in view, organisations give special attention towards determining that whether people are available both internally and externally. They need to carry out careful analysis regarding whom to delegate the responsibility of dealing with internal matters, whom to external matters and how to manage people with different skill set for the purpose of achieving organisations’ intended goals and objectives. Organisational culture Organisational culture plays an important role in strategic HR planning. Managers prefer to develop such strategies that are coherent with the organisational goals and objectives. It enables them to forecast the need for the employees and to determine the exact match of the skill set required for achieving the intended goals and objectives (Snell &Bohlander, 73). Step four: Strategy Formulation After having determined the strategic human resource, the internal strength and weaknesses along with external opportunities and threats, the managers at Jim’s cleaning move towards strategy formulation process after getting complete information regarding all important and essential aspects (Armstrong, 63). The SWOT analysis of Jim’s cleaning that lead to the strategy formulation process is as follows: Strengths Regarded as well-established and specialized cleaning organisation Operating about 30 franchises in different regions Special dedicated franchises for different cleaning process Regarded as equal opportunity employer with about 20,000 employees currently operating. Weaknesses Employees at times are unaware of what they actually doing Clear communication channels need to be there Employees should be able to adapt to the changing environment Product diversification need to be adopted as a strategy for achieving competitive advantage Opportunities Availability of houses and offices in surrounding areas can bring huge revenues Can expand their operations outside the borders of Australia and New Zealand Can earn revenues by introducing some innovating cleansing products Threats Severe competition from competitors can pose a competition to them. Effective and competitive marketing strategies of competitors can put forward severe competition. Swot Analysis of Jim’s cleaning The above mentioned Swot Analysis provides an insight to the HR managers to manage their strategic human resource, financial resources and the useful inputs in such a way that not only leads to successful strategy formulation process but also set stage for successful completion of the tasks. The managers take keen interest in analysing the strengths that need to be capitalized on and the weaknesses that need to be kept at a minimum level. In addition to this, they carry out careful external environment screening for the purpose of conducting careful analysis of opportunities that can bring them revenues and the threats that can either result in lowering their profitability or posing them severe competition. Step Six: Strategy Evaluation After having gone through all the stages, managers at Jim’s Cleaning carry out careful evaluation and assessment of strategies being formulated. In some of the organisations it is regarded as the last step in planning process whereas in few others it is regarded as 1st step because any type of discrepancies identified act as an input for the planning process and thus, it implies that planning is a cyclical process. Managers at Jim’s cleaning conduct strategy evaluation and assessment by employing Benchmarking as a strategy in which the organisations’ performance is compared with other companies competing in same industry. Managers carry out careful analysis and develop performance metrics of the competing organisations and that of their own organisation as well. After comparing those performance metrics they are able to identify the gaps that have affected the organisation’s performance. Proper analysis of the performance gaps help strategists to develop such strategies that not only fill those performance gaps but also lead towards first- class performance. Action plan for Strategic HR Plan Implementation Strategy implementation is one of the crucial and important steps because it turns the strategies being formulated into actions for the purpose of achieving organisational goals and objectives. Defining an appropriate and objective action plan for strategy implementation is even more important than planning HR strategies (Robbins and Coulter, 80). Majority of the organisations do not implement strategies because as reported by Fortune Magazine 9 out of 10 organisations fail to implement their strategies because they lack essential resources for strategy implementation and hence, most of the plans just remain idle on the shelf and do not go through the action phase. Following reasons have been reported as the major cause of failure of objective strategy implementation. 60% of the organisations do not formulate their strategic plans within their budgetary framework. 75% of the organisations fail to link their strategic plans with employee incentive system. 86% of business owners and strategists fail to understand the importance of strategic planning and do not spend enough time in discussing their plans with their employees. 95% of the employees do not understand the importance and content of the strategic plans and hence are unable to know the intended organisational goals and objectives (Strategic plan, 3). A strategic plan acts as a track and a road map for guiding the managers to understand their strategic direction, performance goals and business objectives. Designing a strategic plan does not guarantee successful strategy implementation but however, it does set the stage for achieving organisational strategic goals and objectives. Following is the action plan proposed by managers at Jim’s cleaning. Finalize the strategic plan after taking inputs from all those parties whose interest is at stake particularly the employees. Conduct detailed financial assessment to get a picture of cost and budget issues and link the annual goals with the availability of financial resources. Produce different version of strategic plan being proposed for different departments depending on their nature of work. Proper methods for monitoring the implementation process should be introduced like balanced scorecard system and benchmarking. Define key performance indicators (KPI) and the standards expected of employees accompanied by proper rewards administration. The strategic departmental plans being proposed should revolve around corporate plans. Periodic reviews of strategic plans being proposed should be conducted for the purpose of monitoring the performance against set standards. Monitoring Performance Organisations continually need to review their strategic plans in order to determine that whether they are in line with the business goals and objectives. If so, then they need to review and evaluate the effectiveness of strategic plans being proposed in pursuit of reckoning out the performance of employees towards achieving intended departmental goals and objectives thereby contributing in achieving overall organisational strategy. According to (Caldwell, 54), performance monitoring is about ensuring that whether the expectations that have been set out are being achieved or not. For effective evaluation of employees’ performance towards achieving organisational goals and objectives managers at Jim’s cleaning aspire to develop a partnership between their employees and top management to reach on an agreement regarding what results have been expected of them and how their contribution towards achieving organisational strategy will be monitored and rewarded. Managers at Jim’s cleaning develop performance metrics to figure out employees’ performance and to determine discrepancies if it exists. These performance metrics help them to figure out performance gaps and envision them to develop such strategies that aim at enhancing employee performance towards achieving their goals and objectives. Following is the plan for monitoring employees’ effectiveness towards achieving set performance standards: Develop a monitoring system that acts as a warning alarm and alert the concerned authorities if anything goes off the track. Periodic performance reviews should be conducted to get the employees back on the track. If the tactics and the techniques employed for achieving an organisational strategy do not prove efficient then the managers should change those tactics and techniques. If the strategies already in place do not yield meaningful results then managers at Jim’s cleaning should change that strategy. If smart objectives have not been set the concerned official should spend a reasonable time to develop smart goals with an agreement of employees because they are the ones who have to get the job done (Birnbaum, 4). Plan for improving HR services People are considered as the most complicated and important pieces in business puzzle and the HR department is solely concerned for managing this complex and valuable asset of the organisation. According to (Dubrin, 316), the HR departments are delegated with huge responsibility of managing people because of all the resources human capital and financial resources are very important. Responsibility of managing financial resources lies on the shoulders of finance managers whereas the HR managers are concerned with managing people as a strategic resource. They need to identify and analyse the need for developing employees because it is the only solution that would provide them with best results. Thus, employee training and development is one of the services that need not be overlooked. In addition to this, employee motivation and satisfaction is very important when an organisation intends to achieve competitive edge by pursuing competitive strategies. In doing so, the HR department should provide excellent services in terms of designing reward and compensation system that fosters greater employee satisfaction and ensures an elevated level of employee motivation. However, in addition to this, managers are concerned with employee conflict management and should introduce such strategies that keep conflict level among employees at its minimum. Similarly the HR managers should render their services in terms of maintaining an organisational culture that allows clear communication among employees so that they can easily discuss their departmental objectives and corresponding action plans in detail with their supervisor. Moreover decentralization is also one of the aspects that need not be overlooked by the managers because it makes employees to develop the feeling of being valued when they have a say in organisations’ decision making process. Conclusion Developing strategic HR plan is important for organisations and Jims cleaning strategic HR plan gives the firm the direction for achieving all the goals and objectives of the firm. Profitability and long term success is attained by the organisations by making strategic plans. Works cited Armstrong, M. Strategic Human Resource Management: A Guide to Action. 4th Edition. Kogan Page Publisher. 2008. Print. Birbaum, B. “Monitoring Implementation of your Strategic Plan”. Study Guides and Strategies. Web. 5th March, 2012. Bohlander, W.G and Snell, A. S. Managing Human Resource. 16th Edition. Cengage Learning. 2012. Print. Caldwell, M.C. Performance Management. United States of America: American Management Association. 2000. Print. Carroll, S. “Strategic HR Planning”. Compensation today. 17 Feb, 2009. 5th March, 2012. Web. Dubrin, J. A. Essentials of Management.8th Edition. Cengage Learning. 2008. Print. Robbins, S. P. and Coulter, M. Management 9th Ed. India: Pearson Education. 2008. Print. Strategic Implementation. My Strategic Plan. Web. 5th March, 2012. Read More